In developing the analytic framework for the budget-impact analysis, it is important to define the current mix of treatments in the population eligible for the new drug and likely changes to the current mix over the budget-impact analysis time horizon.
It is also important to understand how the new drug will be used in the context of these current treatments. For example, will the new drug be used as an add-on to current treatments, as a substitute for current treatment, or as a treatment where none was available before? Will it be used in different ways for different patient
Box 2.7. Time Horizon for Budget-Impact Analysis (NICE 2006)
Pegaptanib, a new vascular endothelial growth factor inhibitor, was approved for the treatment of age-related macular degeneration. The drug is given to patients for up to 2 year and discontinued early in patients who do not gain any improvement in vision. Use of this new drug is expected to result in improved visual outcomes such as fewer patients being registered as blind and reduced need for low-vision aids, rehabilitation, community services, and residential care. The table below presents the impact that the drug may have in both the short and long-terms.
Time horizon Outcome 1–5-year time
horizon
• In an analysis submitted to NICE (2006), the direct cost associated with pegaptanib treatment was estimated at approximately £1.2 million in 2006, rising to £22.4 million in 2010
• Cost offsets were estimated to total £101,000 in 2006, rising to
£3.8 million in 2010
• The introduction of pegaptanib in England and Wales was estimated to result in a net direct cost of approximately £1.1 million in 2006, increasing to £18.5 million in 2010 Beyond the 5-year
time horizon
• Due to the disease-modifying effect of pegaptanib, additional cost savings were predicted beyond 2010
• For a 10-year follow-up, additional cost offsets such as services for blind people (i.e., blind registration, low-vision aids, community care and residential care due blindness) and treatment of conditions (e.g., depression and fractures) in people with vision impairment were estimated to total an additional £18.3 million between 2011 and 2015
NICE National Institute for Health and Care Excellence
S. Wolowacz et al.
subgroups and in different jurisdictions? The budget impact of a new drug will largely depend on how it will be added to the current treatment mix for each patient subgroup in the treatment pathway. Clearly, the impact on the drug budget will be higher if it will be used as an add-on to other treatments or in those who have previ- ously not received drug treatment. However, in these cases, savings in condition- related costs might partially or totally offset these budget increases.
In Box 2.8, we present examples of how a new drug might be used when intro- duced and how it might change the use of other drugs.
Another consideration when designing a budget-impact analysis is whether to include the possibility that the new drug will be used off-label in the jurisdiction and also if the existing treatments include drugs that are used off-label. The extent of current off-label use and/or potential for off-label use of the new drug will depend partly on restrictions on such use as well as availability of treatments for a condition and a provider’s predisposition to use off-label treatments. Although drug compa- nies may not promote their drugs off-label, in jurisdictions where such use for the new drug is likely, budget holders might be interested in budget-impact estimates that include this possibility. If off-label drugs are used in the current treatment mix and their use is likely to change with the addition of the new drug, they should be included in the analysis.
In Box 2.9, we present some comments from budget holders on the inclusion of off-label use for a new drug in the budget-impact analysis.
Box 2.8. Differing Uses of New Drugs in the Context of Current Treatments
New drug Place in treatment mix Likely impact on use of other drugs Ofatumumab for
first-line treatment of chronic lymphocytic leukemia (NICE 2014a)
Add-on to the existing treatment,
chlorambucil monotherapy
Unlikely to change use of chlorambucil; reduction in use of other drugs used in combination with chlorambucil (chlorambucil monotherapy and chlorambucil combination therapy will be replaced by ofatumumab plus chlorambucil for some patients) Dabigatran for the
treatment and secondary prevention of
thromboembolism (NICE 2014b)
Substitute for the existing treatment, oral anticoagulants such as warfarin and rivaroxaban
Reduction in use of warfarin and rivaroxaban (replaced by dabigatran for some patients)
Tolvaptan for treatment of autosomal dominant polycystic kidney disease (NICE 2015b)
New treatment; no alternative active treatment was available
None
NICE National Institute for Health and Care Excellence
24
Another factor that can make a difference to the budget impact of a new drug is the rate of uptake that is expected for the new drug in the eligible population. In addition, likely changes in the current treatments related to the uptake of the new
Box 2.9. Budget Holder Comments on Off-Label Use of New Drugs in Budget-Impact Analyses (Watkins and Danielson 2014, Page 3; Goettsch and Enzing 2014, Page 2)
Source Position on off-label use Watkins and
Danielson (2014) Editorial
commenting on the revised ISPOR Budget Impact Task Force Report
• “The task force recommends that model developers not model off-label use of the new product routinely but provide this additional analysis on user request; however, they agree that budget models are descriptive rather than normative. Inclusion of off-label use should not be construed as advocating it, because the models merely depict existing practice patterns without judging appropriateness. We encourage users to request it routinely because off-label use is to be expected in most cases. A model that does not include it is unlikely to reflect the user’s setting realistically. For this reason, the Academy of Managed Care Pharmacy’s Format for Formulary Submissions includes a specific request for ‘significant off-label uses and potential new indications being studied’”
Goettsch and Enzing (2014) Editorial
commenting on the revised ISPOR Budget Impact Task Force Report
• “In 2009, the Dutch minister of health care asked the Health Care Insurance Board (CVZ) to calculate the budget impact of the inclusion of the combined lifestyle intervention (GLI) in the basic insurance package. The GLI is an intervention aimed at overweight and obese persons, advising them on food and eating habits, supporting behavioral change, and supporting physical exercise. The intervention had a potential target group containing 35% of all Dutch inhabitants, and budget
restrictions were getting tighter because of the declining economic situation. So, a BIA was needed, for which the CVZ contracted an independent academic group from the Erasmus University of Rotterdam, the Netherlands”
• “After the BIA became public, two leading Dutch professors on (health) economics … authored an article in ‘Het Financieele Dagblad’ [van den Brink and Groot 2011] in which they suggested that the cost estimates could be an underestimation because indication criteria will often expand. Because off-label use was not part of the BIA, the budget holder could not use the BIA to quantify the effect of the suggested expansion. We think that it would have been better if she had taken off-label use into account”
BIA budget-impact analysis, ISPOR International Society for Pharmacoeconomics and Outcomes Research
Reprinted from Value in Health, 17, Watkins and Danielson (2014), Copyright 2014, with permission from Elsevier
Reprinted from Value in Health, 17, Goettsch and Enzing (2014), Copyright 2014, with permission from Elsevier
S. Wolowacz et al.
drug need to be understood for the jurisdictions of interest. Uptake of the new drug may reduce the number of patients not being treated or may reduce the number of patients taking older, less expensive, drugs. For example, if the treatment shares for the new drug will be taken from another branded drug of similar price to the new drug, the budget impact will be smaller than if they are taken from a low- cost generic drug. In Chap. 4, we describe how to estimate the uptake of a new drug and changes in the use of current treatments.
In Box 2.10, we present two examples of treatment mixes assumed for different budget scenarios and how NICE estimated the changes in the treatment mix with the addition of a new drug.
Box 2.10. Current and Projected Treatment Mixes from NICE Costing Templates
New drug costing template
Current share: treatment shares without new drug after 5 years
Projected share:
treatment shares with new drug after 5 years Secukinumab was a new drug for
treating moderate to severe plaque psoriasis in patients eligible for biologic treatment in England and Wales
Current and projected treatment share were considered:
• Current share: mix of shares without secukinumab was obtained from the manufacturer’s submission
• Projected share: mix of shares with secukinumab was obtained from clinical expert opinion (NICE 2015c)
Adalimumab 50% Adalimumab 40%
Etanercept 21% Etanercept 14%
Infliximab 7% Infliximab 6%
Ustekinumab 22% Ustekinumab 20%
Secukinumab 0% Secukinumab 20%
Alemtuzumab was a new drug for treating active relapsing-remitting multiple sclerosis. A current and projected treatment mix was considered for each budget compared. Data for each treatment mix scenario was obtained from expert opinion (NICE 2014c)
Interferon beta 1a (total)
19% Interferon beta 1a (total)
12%
Interferon beta 1b
3% Interferon beta 1b
1%
Glatiramer acetate
10% Glatiramer acetate
7%
Teriflunomide 40% Teriflunomide 34%
Fingolimod 7% Fingolimod 5%
Natalizumab 11% Natalizumab 8%
Alemtuzumab 0% Alemtuzumab 24%
No DMT 10% No DMT 10%
DMT disease-modifying therapy, NICE National Institute for Health and Care Excellence
26